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EU and California to step up cooperation on carbon markets

Bioenergy International

Markets & Finance

September 14, 2018

European Climate Action and Energy Commissioner Miguel Arias Cañete and California Governor Jerry Brown have agreed to strengthen bilateral cooperation on carbon markets. The announcement was made at the Global Climate Action Summit in San Francisco, California (CA) on September 13. "Climate change is impacting our world today more than ever. We, the EU and California, are both dedicated to working together to identify practical paths to decarbonize the world and deliver on the Paris goals."

On September 13, EU Commissioner Miguel Arias Cañete and State of California Governor Jerry Brown renewed and deepened their joint commitment and confirmed their view that greater alignment of carbon markets is in the interests of both jurisdictions. The announcement was made during the Global Climate Action Summit in San Francisco.

The EU and California have a successful track record of technical exchange and mutual support to date on climate action and carbon markets. EU Commissioner Miguel Arias Cañete and State of California Governor Jerry Brown have renewed and deepened their joint commitment and confirmed their view that greater alignment of carbon markets is in the interests of both.

Climate change is impacting our world today more than ever. We need more action and joint efforts, notably through carbon pricing, to meet this global threat. We, the EU and California, are both dedicated to working together to identify practical paths to decarbonize the world and deliver on the Paris goals, Commissioner Arias Cañete and Governor Brown said in a joint statement.

Over the next twelve months, officials from the EU and California will step up the frequency of exchanges, including on principles for alignment and the role of carbon pricing in:

They also agreed to review, assess, and report on progress in these exchanges in twelve months. The EU emissions trading system (ETS) covers some 45 percent of EU greenhouse gas (GHG) emissions in some 31 countries, has been in operation since 2005, and is set to deliver a reduction of around 43 percent in EU emissions on 1990 levels in 2030.

The European Commission and California will work through the Florence Process, which brings together representatives of the key jurisdictions with emissions trading programs, including the EU, California, China, Canada, Québec, and New Zealand, to address issues of common interest.

Today we show that we are dedicated to remaining at the forefront of global action on climate change and the transition to a low-carbon economy. We will work closely together on carbon markets to contribute to the ambitious goals of the Paris Agreement. The experience of the EU and California can help identify opportunities and enable higher ambition. We are dedicated to working closely together, but also with others who are similarly committed to implementing cap and trade, in particular through the Florence Dialogue, said Commissioner Arias Cañete.

The California ETS covers some 85 percent of California emissions and is linked to the ETS of Quebec. The linked California and Québec ETS is the only economy-wide ETS in the Americas.

To avoid climate catastrophe California and the EU must collaborate even more closely on carbon pricing — and all other climate actions, said Governor Brown.